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German automakers have frequently bought shares in China Power Battery Company to further speed up the layout of the electrified industry and expand the market in China. After Volkswagen Group invested 8.7 billion yuan to become the largest shareholder of Guoxuan Hi-Tech, Mercedes-Benz also announced that it would take a stake in a Chinese battery company.

On July 3, Mercedes-Benz announced that it would take a stake in Funeng Technology, a Chinese manufacturer of power battery batteries, and further deepen strategic cooperation. Under the plan, Daimler Greater China Investment Co., Ltd. will invest tens of millions of euros in exchange for a 3% stake in Funeng Technology, and Daimler will send a representative to join the Funeng Technology Supervisory Board after the deal is completed.

This time, the two sides will jointly develop high-tech battery technology, vigorously enhance cost competitiveness, further increase battery energy density and shorten charging time. The agreement will also guarantee the supply of power battery cells for Mercedes-Benz in the electrification process, while Funeng Technology can ensure its planned capacity construction. At the same time, in order to meet the power battery needs of Mercedes-Benz, Funeng Technology will build a power battery factory in Germany.

Daimler already has a partnership with Funeng Technology, which buys power batteries from the latter. In the future, Funeng Technology will participate in the next generation product project of Mercedes-EQ brand electric vehicles as a supplier. For its part, Daimler-Benz said it would deepen cooperation with Chinese companies to support its global electrification strategy and would further strengthen local research and development, production and procurement in China.

According to information, Funeng Technology (Ganzhou) Co., Ltd. was established on December 18, 2009, the business scope includes lithium-ion battery and module system, battery module management system, charging system and other electric vehicle energy storage and management system research and development, production, sales and so on.

Funeng Technology ranks seventh in China's power battery installed list in 2019, with an annual battery installed capacity of 1.21GWh and a 1.95 per cent market share in China.

Before Daimler Mercedes-Benz, Volkswagen Group had successfully acquired a stake in Guoxuan Hi-Tech and became the largest shareholder of the latter.

In order to support the electric development of the Future Group, Volkswagen Group officially announced on May 29 that it would invest 1.1 billion euros (8.7 billion yuan) in battery manufacturer Guoxuan Hi-Tech, acquiring a 26% stake in the latter and becoming a major shareholder.

Volkswagen said that Guoxuan Tech will become the certified supplier of Volkswagen, supply batteries to the group's pure electric vehicles and MEB platform products in the Chinese market in the future, and will actively carry out strategic cooperation with Guoxuan Tech in the field of electric vehicle battery cells.

Volkswagen plans to deliver about 1.5 million new energy vehicles to Chinese consumers by 2025.

Guoxuan Tech is the third largest power battery supplier in China, with an installed capacity of 3.31GWh in 2019 and a market share of 5.33%.

A number of German car companies have taken a fancy to Chinese power battery companies and invested heavily, which will help to promote their electrification strategy in China and improve their competitiveness in the world's largest new energy vehicle market. But the big challenge is that sales of new energy vehicles in China have continued to decline. According to data from the China Automobile Association, from January to May, the production and sales of new energy vehicles in China completed 295000 and 289000 respectively, down 39.7% and 38.7% respectively from the same period last year.

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